KLIA Customs seizes RM49.5m in AI chips with potential military uses, fifth case in RM100m syndicate probe

On October 15, Malaysia's KLIA customs department thwarted an attempt to transit 30 servers loaded with high-performance artificial intelligence chips, valued at nearly RM49.5 million. The chips, potentially usable in military technology development, were seized by a team from the KLIA customs enforcement division during an inspection of a warehouse at the KLIA Free Trade Zone.

Customs director Aspalila Ag Tuah revealed that the servers had been smuggled from an Asian nation under a single air waybill, ostensibly to evade detection, before being re-exported to another Asian country. The syndicate exploited Malaysia as a transit point to circumvent export restrictions on the chips, which are classified as dual-use items due to their potential for use in weapons of mass destruction.

The Strategic Trade Act 2010 governs the export, transit, and transshipment of advanced AI chips in Malaysia, with shipments exceeding a total processing performance value of 4,800 or 1,600 with a performance density of 3.2 or higher requiring a permit obtained 30 days prior to entry. The ministry's strategic trade secretariat confirmed that the seizure was the fifth case involving the same syndicate this year, with the total value of seizures across all five incidents surpassing RM100 million.

No arrests have been made yet, and the ongoing investigation falls under Section 12 of the Strategic Trade Act 2010, which imposes penalties of up to RM20 million for corporations and up to RM10 million and imprisonment for up to 10 years for individuals convicted of willful offenses.